“You money reformers are all alike — you think you can just throw money at the problem!”

It’s true.  We think we CAN solve our economic problems by throwing money at them, money generated as credit by a publicly-owned bank. Money is just a legal agreement between parties and the community. It doesn’t need to be dug out of the ground, and it doesn’t need to be borrowed from someone who is hording it. It can be created as credit on the books of a publicly-owned bank, the credit of a community willing to advance goods and services on the promise of being repaid in equivalent value from the fruits of the borrower’s labor. This blog is for people interested in pursuing that sort of approach to the current credit crisis.

27 Responses

  1. Huffington Post article suggests pulling money out of too big to fail banks today. I suggested readers look at this blog for other ideas on how to protect themselves and use their money to initiate positive changes.


  2. Hi,we need a private bank acting like gov. treasury.An institution giving out 0% loans with interest being overhead.People,deposit their money,wil get no interest.This reserv. will take all profit,and use for the common good.I say lets us people do it.We need a high profile person or organization to P.R. this.

  3. Upon reading Dr LR Wray’s book ‘Understanding Modern Money. The key to full employment and price stability’ and examining the articles at his blogsite:


    as well as the articles/comments by Bill Mitchell, PhD (Australian economist who maintains billy blog):

    (for some reason his website is down on March 24, 2010?)

    it would appear that the mechanics and theoretical aspects of MMT (modern money theory) are adaptable to a scheme which Ellen Brown proposes for government-issued currency. It is possible that similar strategies are already acknowledged to be employed in other political jurisdictions with which I am unaware. I would like to learn of other potentially appropriate strategies formulated by trained/experienced economists which would likely facilitate a strategy encouraged by Dr Brown to get the government of the USA running in a survivable fashion. It seems as if the currently popular approaches employed by President Obama’s advisers are not really concerned with the non-elite (95-99%) of the population of this country.

    • Hi, thanks for writing. There is quite a bit of information in my articles at http://www.webofdebt.com/articles and the blog linked there. Best, Ellen

      • After looking at the articles at the link you mentioned, I can agree that you have done a lot of work along the line of your arguments regarding the merits of such institutions as state banks. Even though a few individuals are/have attempting/attempted to push proposals for state banks, I suspect that there are likely to be unanticipated hurtles to actually starting such institutions, especially because there is (a) an existing bias in the form of retaining the current vested interests priorities in control and/or (b) design of institutions which will serve the public as opposed to potential new investors in such state banks. It seems to me that a better possibility would be to just do away with the current system and controlling banksters, then start over.
        The MMT (modern money theory for government control of fiat money/currency) approach should be considered a possible basis for such a new start as its focus is government service to society by facilitating full employment. This is a paradigm shift which will require much more wide-spread enlightenment than currently exists; if you spent some time studying the ideas of economists such as those I previously mentioned it is possible that your insights and experience as a writer could facilitate a more wide- spread understanding of the potential of the efforts which you are currently promoting.

  4. Hi Ellen,the solution is the Public Bank,why cannot a group of people/organization start one? $ 5 million to start a small bank,that not much to start a revolution. You talk to Michael Moore? Ralph Nader? Howard Dean? Any one of these guys, can this thing going. THANKS

    • We could, and in fact I’ve thought about it personally; but small banks go bankrupt all the time. It’s a bad economic climate for startup banks. We won’t have the capital and asset bases to weather the storm. A state, on the other hand, is a seriously deep pocket, a tree with stable roots. It’s not going to go bankrupt, particularly if it can generate its own credit. It’s got major capital and a major potential deposit base.

  5. Hi Ellen,you know how slow gov. work,and you don`t even want to think about a corrupt one.We don`t have the time,the storm is headed for judgement day.A good idea with P.R.,will take off(like a wild fire) People see a bank(aka,N.Dakota State Bank) O% loans and investing in fair trade businesses,they would happily take their money from the “Banksters”.Ellen,this is Thomas Paine Common Sense(1776),we learn to vote,we learn to invest.Ellen,it takes about $5 million to start a small bank,talk to others progressives(Michael Moore,Ralph Nader,Howard Dean,Tom Hartmann, Amy Goodman,Etc..) Have good media do a poll Ellen,a good bank could have prevented WW2,lesson learn.The world bank/IMF work for big corp/ globalization/colonialism,we need a bank for the “People”.(control by them).Ellen,call a town-hall,I`m ready to give my life for Economic Democracy, and I know most people would too.We boycott the the banksters,our little bank will become big over night. Please,lets do this,God is giving us,but so much time. THANKS

  6. Mr.W.Wilson,how can we. have “wide spread enlightenment”, with a big corrupt media that keep people dumb-down? If progressive leaders get on progressive media, and talk 24/7 on starting a grass-roots public bank,we could have that “ENLIGHTENMENT”. WHERE IS OUR PROGRESSIVE LEADERS???? ARE THEY TO FAT,TO START A REVOLUTION??? OR TO SCARE????

  7. I think many are wondering about the same questions which jessie taylor brings up. My impression is that Congress and the Executive Branch are beholden to the banksters, the military-industrial complex, and any number of other moneyed interests. The fundamental problem is our election system is broken; you and I do not have unlimited resources and we follow the rules, thus, all politicians get their funding primarily from private sources which then emerge as their major concern/benefactor.
    If you are interested in a potentially interesting activist approach, you may wish to check Lawrence Lessig’s site – FixCongressFirst.org and/or decide whether you have an interest in supporting the petition for a Constitutional Congress via petitions to various state legislatures at – CallaConvention.org. If you are unfamiliar with Mr Lessig’s background, check his Wiki-biography.

  8. Mr.W.Wilson,do you think,and Mr.L.Lessig,that we/world have time or money to get the politicians to act right? We wait on the political process,we can kiss this world “goodbye”.We don`t get leaders(grass-root) strong enough for change,we can kiss this world goodbye.

  9. I think that many American citizens would like to hear some sort of encouraging answer to jessie taylor’s question. To my knowledge, a Constitutional Convention convened by the required number (34/50) of states is a legal approach to try to get the attention of TPTB (the powers that be); it may take quite a while to get the ball rolling. Mr Lessig has a background which would be much more appropriate than mine to attempt to gauge timing. While mass demonstrations may eventually occur, such an approach would likely be rapidly dissipated as the TPTB controls the press, military, IRS, and all other facilities within the Executive and Legislative branches of government (did I mention the Judicial branch?). It can only be hoped that some concerned leadership group can evolve to join with Mr Lessig’s initiatives to get the ball rolling. Let’s face it, government only appears to serve the super-rich and super-powerful in the US.

  10. Drs LR Randall and Bill Mitchell (see comment above) have been outspokent proponents of MMT (modern money theory) as a strategy/model for facilitating government’s generation/control of fiat currency in order to facilitate ‘full employment and price stability’. Without going into the subject of MMT (which a non-economist might imagine to be related to the US economy, even though it isn’t), if it could serve a modern economy such as that of the US, it is a model which Dr Ellen Brown might accept as potentially useful in expediting the various types of banking reforms she has attempted to write about. Further, I would encourage anyone who thinks a reform of the US banking and economic models is desirable to familiarize himself/herself with MMT.

    In Bill’s blog of 4/8/10, he describes the mistaken analysis provided recently by Fed Reserve chairman Ben Bernake regarding the cause(s) of the current economic mess in which the US finds itself. Further, Dr Mitchell describes the likely negative consequences of expediting Bernake’s proposed solution. Finally, he proposes that Bernake be replaced, then, perhaps, offered a position in President B Obama’s (yet to be announced) new Jobs Guarantee program.

    ‘US federal reserve governor is part of the problem’


  11. Mr.W.Wilson,thanks for info on MMT.Common sense is the only theory,we need to want control of our money.Ellen,say it take $20 million to start a bank.The people you mention,would they be interested in starting one?

  12. Mr.W.Wilson,Bernake(and Co.) is stupid,you can`t fix a bad idea(capitalism) Economic Democracy system would be base on fair trade and the common good(public) A system where`s their no “losers”.We know the problems,time to work on common sense solutions.

  13. Regarding Jessie Taylor’s mention (above) of the process of starting a bank, she may find the discussion in Paul Krugman’s article of April 11:


    to be of interest. See the following passage:
    ‘And for all the concern about banks that are too big to fail, Georgia suffered, if anything, from a proliferation of small banks. Actually, the worst offenders in the lending spree tended to be relatively small start-ups that attracted customers by playing to a specific community. Thus Georgian Bank, founded in 2001, catered to the state’s elite, some of whom were entertained on the C.E.O.’s yacht and private jet. Meanwhile, Integrity Bank, founded in 2000, played up its “faith based” business model — it was featured in a 2005 Time magazine article titled “Praying for Profits.” Both banks have now gone bust.’

    My impression is that management and regulation of managers’ behaviors may be at least as important as the model for the institution.

  14. Readers of Ellen Brown’s Public Banking blog and who wonder whether her proposals are likely to have credibility, may be interested to know that a small number of economists have thought about/proposed money market theory (MMT) a way in which the government may both print and control fiat currency.
    Those who have thought along these lines may be interested to learn about Joe Firestone’s attempt to get attention from the press whose attention is sure to be focused on the conference being orchestrated by the Pete Peterson (Blackstone) group on April 27 and 28 in Washington D. C.:

    Announcement at Joe Firestone’s site :


    A Fiscal Sustainability “Teach-in” Counter-Conference?

    I know that time is short between now and April 28th. But nevertheless, I propose that we organize a counter Fiscal Summit “Teach-in” Conference in Washington DC, on that day. Such a “teach-in,” depending on how many people we could get to attend, could steal media attention from the Peterson-sponsored event, and introduce an opposing narrative to the ones coming out of the deficit hawk events on the 27th and 28th. To have such a Conference would take money. Speaker expenses would have to paid, as would hotel expenses if it were possible to get a hotel site at this late date. On the other hand, it would not be hard to think of high-level speakers for such a Summit. Here’s my list of speakers who could do a really good job delivering a Modern Monetary Theory counter to the neo-liberal paradigm: L. Randall Wray, William K. Black, James K. Galbraith, Warren Mosler, Marshall Auerback, Bill Mitchell, Rob Parenteau, Yeva Nersisyan, Scott Fullwiler, and some other very good top-level participants who would question the neo-liberal paradigm to at least some degree are: Yves Smith, Simon Johnson, Joseph Stiglitz, Robert Johnson, Robert Reich, Robert Kuttner, and Dean Baker. Finally, someone who ought to be invited, since he’s expressed frequent and very explicit criticism of the neo-liberal paradigm is George Soros. It would be valuable to get him into direct discussions with others on the relationships between hedge fund traders and nations with unencumbered fiat monetary systems.

    Who should hold this counter-conference? I propose that Firedog Lake, The Huffington Post, New Deal 2.0, and The American Prospect jointly sponsor and provide financial backing for this Conference. If the Conference could be planned and implemented over the next three weeks, it could go a long way toward beginning to blunt the impact of the Peterson Foundation Event and the first meeting of the President’s Commission. We need to blunt that impact if we expect to have any material success in getting progressive legislation on a host of issues in the coming decade. “We must make this commission politically radioactive.”

    other relevant links:


    • Hi, funnily enough I just met with Dr. Wray last week. Good idea, but time is a bit too short as you say! He’ll be in Europe then I think. Best, Ellen

  15. Hi W.Wilson,very good idea,I hope the groups you mention are brave enough to do it.I`m broke,but I would find something to give in support.I would add,more importantly,we need a teach-in for the common people.I`m tired of seeing smart people to scare to do anything.Common people see the problem,and see they have nothing to lose vs what they have to gain,they will act!

  16. Hi Ellen,keep thinking,time to put good ideas to work and bad ones to “rest”. Thanks

  17. Should you have an interest in the Fiscal Sustainability Conference:
    The tentative program schedule, topics and presenters as of 04/20/10. Venue: The George Washington University’s Marvin Center, Room 310, The Elliot Room.


    One can read about the proposed conference here:


    This conference is designed to elucidate how our fiat money system could work were the currency is issued by the US government (as contrasted with the current process which is generally thought to allow the privileged banksters to effectively control this economy).

    The organizers are aware of Pete Peterson’s backing of a larger (officially sanctioned?) conference scheduled to occur on April 27-28 at another venue at which the MSM will likely gather and take notes. I have read that topics at the Peterson-sponsored conference are thought to be concerned with explaining why the Blackstone Invest group should manage retirement funds and why social security should be done away with.

  18. Presentations at the Fiscal Sustainability Teach-In and Counter-Conference of April 28th, 2010 are summarized at a web page maintained by selise:
    Audio recordings, as well as pdf files of some power point presentations of slides, are available. I have listened to most and find them generally well-done.

  19. The housing industry has over $3 trillion in homes that are held without mortgages. One out every three. These home owners receive no return on their investment. This is wrong. A central bank holding mortgages could lend at cost. Part of that cost could be a dividend paid to owners once they pay off their loans making a home a true investment. Holding mortgages allows for flexibility when buyers are facing default. There are many good ideas on this. Sadly a central bank would make money on foreclosures. Loans could stay with buyers when they move eliminating the high costs of starting over with a new loan every time one moved. No PMI would be needed. Loans would be assumable.
    The problem would be in transitioning away from an entrenched secondary mortgage market. Cashing out all MBS and having safegaurds in place to ensure viable banks don’t go under may be to big of a shock once the vail of secracy is lifted from the books of big lending institutions.
    Any thoughts?

  20. Ellen,

    I finally got around to picking up a copy of Ray Sorenson’s film, “Northern Lights” on video cassette, the only format it is currently available in. My Presbyterian Church social justice committee endorsed my showing the film to interested members of the congregation and I’m going to see about a group of us reading your book, “Web of Debt” together. We are in Chicago and there is certainly interest here in establishing a state bank and hopefully this will help further that. Your articles continue to impress and inspire me, a light in one of the gloomiest times I have seen. Please add me to your emailing list for updates to your articles and or blog postings.

    Many thanks,

    Jeff Story

  21. Who is working to promote a State Bank of Texas?

  22. “Among other advantages, this gives the BND the ability to participate in loans originated and led by private banks, which then have more flexibility to manage and expand their loan portfolios”

    I am interested in the concept but some of the reasoning seems flawed. If you are going into loan participations, there is significant exposure; sometimes greater than the direct loan. I witnessed this in the Bank of New England, NA debacle in 1990. I was personally affected having opened an FSB in MD, the moving to MA for BNE. After 2 yrs w/ FDIC I was out of a job. So…I know the risks on all 3 sides of the triangle.

    The key to Public Bank or Private Bank is “Best Pratices”. When I refer to “Bank” I mean back in the Glass-Steagall” sense or the Mutual Savings Bank model

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